Companies remain committed to providing pensions, but the high cost of running them is hitting profits and investment, a survey shows today.
Those with defined benefit schemes are now contributing the equivalent of nearly a fifth of employees' pay on average, with some firms paying in as much as 40 per cent and a few even 100 per cent.
As well as increasing annual contributions, 45 per cent of firms have also made additional lump sum payments to their scheme averaging £12.6 million, rising to £200 million for one company.
But despite this, three-quarters of companies said they were committed to providing an occupational pension scheme, according to research carried out by business group the CBI and Mercer Human Resource Consulting.
CBI deputy director-general John Cridland said: "The added burden of spiralling pension contributions is threatening UK firms' ability to invest in future jobs and growth. Employers remain committed to pensions but they are going to need support to weather the current storm."